Amazon makes bid to buy Lovefilm

Updates to this story

Amazon has made a bid to buy out DVD rentail company Lovefilm for somewhere in the region of £200 million, according to unnamed sources close to The Sunday Times.

Amazon currently holds a 42 percent stake in Lovefilm. It acquired 32 percent of the shares in a deal in 2008 which combined its European movie rental service with Lovefilm. It nabbed a further 10 percent by buying out one of Lovefilm's venture capital backers. Now it's back to finish the job.

In June 2009 several reports surfaced that Lovefilm was looking for a buyer, but no offers were made then. With Amazon having such a large stake in the company it seems likely that it will want to buy the rest.

London-based Lovefilm was established in 2002 and has grown into the largest DVD rental service throughout the UK and Europe, with over 1.4 million subscribers. In July of this year Lovefilm signed a deal with digital rights management and video optimisation firm US-based Widevine, aimed at increasing Lovefilm's customer base even further.

Neither Amazon or Lovefilm have confirmed the acquisition deal at this time.